HKMA's currency defense having little effect so far
USD/HKD still sits at the top of the trading band - near 7.8500
The HKMA has spent about HK$9.7 billion already since Thursday last week, when the HKD fell to the weaker end of the trading band.
And seeing that the HKMA having to step in so early and with such force, it shows that outflows in the HKD are much more than initially thought. And that will leave the hKMA with an interbank cash supply of HK$170 billion - from pre-intervention levels of around HK$180 billion.
While still early days - there is time for repricing of the forward market - further downward pressure against the HKD will surely not be welcome by the HKMA, particularly if they have to continue to step up intervention in the currency market.